On January 1, a company issues bonds dated January 1 with a par value of $400,000. The bonds mature in 5 years. The contract rate is 7%, and interest is paid semiannually on June 30 and December 31. The market rate is 8% and the bonds are sold for $383,793. The amount of the semi-annual cash payments of interest is:
A)$14,000.00.
B)$28,000.00.
C)$32,000.00.
D)$16,000.00.
E)$15,620.70.

Question

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The Answer of On January 1, a company issues bonds dated January 1 with a par value of $400,000. The bonds mature in 5 years. The contract rate is 7%, and interest is paid semiannually on June 30 and December 31. The market rate is 8% and the bonds are sold for $383,793. The amount of the semi-annual cash payments of interest is:
A)$14,000.00.
B)$28,000.00.
C)$32,000.00.
D)$16,000.00.
E)$15,620.70.

On January 1, a Company Issues Bonds Dated January 1